What is your Kodak Moment?

I was just speaking in Rochester NY, which is the home town of Kodak. Very fitting that I was talking about Agility and how to avoid a “Kodak Moment”, like your average taxi-cab firm is having right now! I was then in NYC Times Square (where this photo above was shot years ago) using Uber to go everywhere! Which industry might be Uberized next? Digital disruption is coming your way soon!

Maybe the most famous digital disruption of all time is Kodak! We all vaguely know the story of their rise and fall, despite having invented the digital camera in the first place, but I decided I was going to research it a lot more deeply, not least of all for my next book.

“Eastman Kodak Co. is often cited as an iconic example of a company that failed to grasp the significance of a technological transition that threatened its business. After decades of being an undisputed world leader in film photography, Kodak built the first digital camera back in 1975. But then, the story goes, the company couldn’t see the fundamental shift (in its particular case, from analog to digital technology) that was happening right under its nose.

“The big problem with this version of events is that it’s wrong.”

“Kodak management has been criticized for compromising its digital efforts because it wanted to protect film.

“But the criticism is overblown”.

“Lessons for Managers. Every situation is different, but the experiences of Kodak suggest some sobering questions for managers in industries undergoing substantial technology-driven change. Among them are:

Is our core technology converging to the point of being replaced by a general-purpose technology platform? If so, the company could lose manufacturing scale and early-mover advantages — such as being far down the legacy manufacturing learning curve.

Is the technology that underpins our business likely to shift to a digital/modular platform that will lower barriers to entry? If so, commoditization pressure will be inevitable, and the company must prepare to live on much lower margins.

Do we have a capital-intensive legacy business? If so, can we develop a strategy for scaling down production volumes that is both capital efficient and keeps production costs from rising excessively? This is key to maximizing cash flow while trying to execute a transition. It will involve using older equipment or repurposing production assets to make alternate products.

How does the balance of power in our ecosystem change as technology shifts impact different parts of the value chain differently? Will the interests of partners cause our company to do things that are contrary to its long-term interests? This requires thinking about how ecosystem partners will manage the transition and adjusting strategy accordingly.”

“There are few corporate blunders as staggering as Kodak’s missed opportunities in digital photography, a technology that it invented. This strategic failure was the direct cause of Kodak’s decades-long decline as digital photography destroyed its film-based business model.”

“Steven J. Sasson, an electrical engineer who invented the first digital camera at Eastman Kodak in the 1970s, remembers well management’s dismay at his feat. “My prototype was big as a toaster, but the technical people loved it,” Mr. Sasson said. “But it was filmless photography, so management’s reaction was, ‘that’s cute — but don’t tell anyone about it.’ ”

Some GREAT videos below

Watch this space … more to come.

Here’s a great video including Steve Sasson:

The Rise and Fall of Kodak. Great video which tells the whole story in just 6 minutes, including lots of data and graphs. Really excellent.

Kodak’s Dilemma. 2nd great video in the same series as the one above exploring “the incumbent’s dilemma”

Here’s a 2007 Marketing Video announcing that “Kodak is Back” at the leading edge of Digital Photography. Very funny! Just too little too late!

“After the Kodak Moment” is a great video which brings the story more up to date:

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The question of my diverse career as a leader has been, “why, despite all of our investments in developing our businesses, do we still experience much more wheel$pin than we should, which costs us a fortune and possibly our future prosperity, in business and life?”

The answer: agility (or rather, a lack of it), which has become the focus of all of my activities:

I am now an agile-facilitator/mentor/coach and speaker; I chair round-table peer groups of CEOs and executives, helping them be more agile in business and life; I sit on numerous boards as their agile eyes and ears.